Consumer News

AG Derek Schmidt settles with computer company for preinstalled software

Release Date: Sep 07, 2017

TOPEKA – (September 7, 2017) – Kansas Attorney General Derek Schmidt today announced that he has entered a settlement with technology company Lenovo (United States) Inc., requiring the company to change its practices related to preinstalled software on computers sold by the company.

The settlement resolves allegations that the company violated state consumer protection laws by preinstalling software on laptop computers sold to Kansas consumers that made consumers’ personal information vulnerable to hackers. The settlement was negotiated and finalized by Schmidt and 31 other state attorneys general in coordination with the Federal Trade Commission.

In August 2014, North Carolina-based Lenovo began selling certain laptop computers that contained pre-installed ad software called VisualDiscovery, which was created by the company Superfish, Inc. VisualDiscovery purportedly operated as a shopping assistant by delivering pop-up ads to consumers of similar looking products sold by Superfish retail partners whenever a customer's mouse hovered over the image of a product on a shopping Web site. The states alleged that VisualDiscovery displayed a one-time pop-up window the first time consumers visited a shopping website. Unless consumers affirmatively opted out, VisualDiscovery would be enabled on their computers.

The software allowed the company to see all of a user’s sensitive personal information that was transmitted on the Internet, potentially exposing them to identity theft.

Lenovo stopped shipping laptops with VisualDiscovery preinstalled in February 2015, though the states allege that some laptops with the software were still being sold by various retail outlets as late as June 2015.

 “We take seriously our responsibility to protect Kansas consumers’ personal information from falling into the wrong hands,” Schmidt said. “Today’s settlement reflects our commitment to vigorously pursue those who put this information at risk.”

The settlement requires Lenovo to change its consumer disclosures about preinstalled advertising software, to require a consumer's affirmative consent to using the software on their device and to provide a reasonable and effective means for consumers to opt-out, disable or remove the software.

The consent judgment was approved this week by Shawnee County District Court Judge Teresa Watson. The case is State of Kansas v. Lenovo (United States) Inc., case number 2017-CV-578.

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